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Tuesday, April 27, 2021
ESTATE PLANNING PITFALL
Your Charitable Gifts are Unrestricted If you’re making sizeable donations to charity as part of your estate plan, your good intentions are clear. But how do you know the funds will be used to further the charity’s mission? There are no absolute guarantees. For instance, a financially sound charitable organization could begin experiencing economic difficulties and eventually file for bankruptcy or even halt operations. In that case, your donations may be used by the charity to pay off creditors or be allocated to some other purpose you hadn’t envisioned — and no one is going to ask your permission. Fortunately, however, you can take steps to preserve your charitable legacy.
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Tuesday, April 27, 2021
HOW DOES THE SECURE ACT AFFECT ESTATE PLANNING? The Setting Every Community Up for Retirement Enhancement (SECURE) Act is the biggest retirement planning law in decades. However, when all is said and done, the new law may have just as significant an impact on estate planning, especially if younger individuals are in line to inherit IRA or qualified retirement plan accounts. Key Secure Act Provisions The SECURE Act includes noteworthy provisions for both individuals and businesses. (See “Nothing personal, strictly business” at X for business-related provisions.) Here’s a summary of the key tax law changes for individual retirement-savers.
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Tuesday, April 27, 2021
HSAsUnderstanding the Health Savings and Estate Planning Benefits In addition to being a viable option to reduce health care costs, a Health Savings Account (HSA) can positively affect your estate plan because its funds grow on a tax-deferred basis. An HSA is similar to a traditional IRA or 401(k) plan in that it’s a tax-advantaged savings account funded with pretax dollars. Funds can be withdrawn tax-free to pay for a wide range of qualified medical expenses. ABCs of an HSA To provide these benefits, an HSA must be coupled with a high-deductible health plan (HDHP). For 2020, an HDHP is a plan with a minimum deductible of $1,400 ($2,800 for family coverage) and maximum out-of-pocket expenses of $6,900 ($13,800 for family coverage).
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Friday, January 29, 2021
CONSIDER ALL THE ANGLES OF JOINT OWNERSHIP
Estate planners generally tout the virtues of owning property jointly — and with good reason. Joint ownership offers several advantages for surviving family members. But this shouldn’t be viewed as a panacea for every estate planning woe. You must also be aware of all the implications. 2 types of joint ownership As the name implies, joint ownership requires interests in property by more than one party.
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Friday, January 29, 2021
DOES A QUALIFIED CHARITABLE DISTRIBUTION MAKE SENSE THIS YEAR?
A unique provision in the tax code allows certain retirees to avoid tax on transfers made directly from a traditional IRA to a qualified charitable organization. Although one of the main attractions of a qualified charitable distribution (QCD) has been negated for 2020, there are still several viable reasons for making a QCD this year. At the same time, charities that are in dire need of funding during the COVID-19 pandemic will greatly appreciate your generosity. The back story Normally, distributions from traditional IRAs are taxable at ordinary income tax rates, currently reaching as high as 37%. If you take money from an IRA and donate it to a qualified charity, it’s deductible on your annual tax return if you itemize deductions.
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Friday, January 29, 2021
Shh! THIS IS A SILENT TRUST, LET'S KEEP IT QUIET!
Generally, estate planning advisors recommend that you be upfront with family members about how you plan to divide your assets. For example, you might hold a family meeting or write a letter to accompany your will. However, if you’re using a “silent trust,” sometimes referred to as a “quiet trust,” you’ll have keep it to yourself. A silent trust limits the amount of information shared with beneficiaries or, in some cases, keeps the existence of the trust secret. This trust type offers many benefits, but also a few drawbacks.
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Friday, October 16, 2020
HSAs Understanding the health savings and estate planning benefits In addition to being a viable option to reduce health care costs, a Health Savings Account (HSA) can positively affect your estate plan because its funds grow on a tax-deferred basis. An HSA is similar to a traditional IRA or 401(k) plan in that it’s a tax-advantaged savings account funded with pretax dollars. Funds can be withdrawn tax-free to pay for a wide range of qualified medical expenses. ABCs of an HSA To provide these benefits, an HSA must be coupled with a high-deductible health plan (HDHP). For 2020, an HDHP is a plan with a minimum deductible of $1,400 ($2,800 for family coverage) and maximum out-of-pocket expenses of $6,900 ($13,800 for family coverage).
Read more . . .
Friday, October 16, 2020
HOW DOES THE SECURE ACT AFFECT ESTATE PLANNING
The Setting Every Community Up for Retirement Enhancement (SECURE) Act is the biggest retirement planning law in decades. However, when all is said and done, the new law may have just as significant an impact on estate planning, especially if younger individuals are in line to inherit IRA or qualified retirement plan accounts. Key SECURE Act Provisions The SECURE Act includes noteworthy provisions for both individuals and businesses. (See “Nothing personal, strictly business” at X for business-related provisions.) Here’s a summary of the key tax law changes for individual retirement-savers.
Read more . . .
Friday, October 16, 2020
TO FILE OR NOT TO FILE?
A gift tax return doesn’t always have to be filed.....
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Wednesday, September 30, 2020
Letter of Instructions Make your thoughts crystal clear to your family Generally, every estate plan requires a will, but this main attraction may be complemented by other documents, like a letter of instructions. The letter, unlike a valid will, isn’t legally binding, but can be valuable to surviving family members. If you haven’t done so already, draft a letter of instructions and, most important, make sure that others know where and how to locate it. The basic elements Although the content can vary from person-to-person, one of the main purposes of a letter of instructions is to provide details on final wishes that haven’t been covered in the will. Think of the letter as a way to fill in some of the “gaps” or resolve matters left open to interpretation.
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Wednesday, September 30, 2020
Beware of the Generation-Skipping Transfer Tax
Thanks to recent tax law changes, most families can avoid liability for federal estate and gift taxes. However, there’s a lesser-known tax whammy that can hit wealthy individuals without warning: the generation-skipping transfer (GST) tax. As its name implies, the GST tax generally applies to transfers that “skip” a generation. Nevertheless, with astute estate tax planning, including the use of a generous lifetime gift tax exemption, you may able to sidestep any dire consequences under the GST tax, or at the least minimize its impact. History of the GST Tax
The genesis of the GST tax goes back to the 20th century.
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Littorno Law Group assists clients throughout Contra Costa County from our offices in Pittsburg, Pleasant Hill and Rancho Bernardo, California, including Antioch, Brentwood, Clayton, Concord, Lafayette, Moraga, Martinez, Danville, San Ramon, Pleasanton, Livermore, Fremont, Oakland, Piedmont, San Diego, Escondido, San Marcos, Vista, Oceanside, Carlsbad, Fallbrook, Bonsall, Encinitas, La Jolla, Poway, Rancho Bernardo, Del Mar, and the surrounding areas and suburbs.
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